Part Four: Preparing to Exit Canada for the United States?

By John McCord, Cardinal Point Wealth Management

It is important to have an experienced
cross-border attorney analyze an existing estate plan prior to a move. In like
manner, a U.S. cross-border attorney and a Canadian cross-border attorney are
often consulted when assets remain on both sides of the border. Cross-border
estate planning is a sophisticated field and is subject to frequent change. The
estate planning laws in Canadian provinces and in U.S. states are not uniform,
which can lead to different interpretations. Tax ramifications, ease of
administration and financial objectives should all be considered when
constructing a cross-border estate plan. Collaboration between cross-border
financial advisors, CPAs, CAs and other practitioners creates a cohesive
strategy and is highly recommended. Importantly, a knowledgeable
cross-border financial advisor has the ability to identify shortcomings and work
under a team approach.

Private pension income is an
important revenue source for many Canadians. Individuals who have Canadian
corporate pensions should understand how a U.S. domicile might effect their
pension taxation in lieu of a Canadian domicile.Currently, the CRA fully taxes company
pension plans but subtracts an annual $2,000 dollar credit for Canadian
residents. However, Canadian pensions are taxed at IRS income tax rates when
domiciled in the U.S. The IRS income tax rates can create additional
after-tax pension income but double taxation might also be the outcome of a
transition without the involvement of a knowledgeable cross-border professional.
Double taxation by the CRA and IRS can be mitigated through the Canada-U.S. Tax
Treaty and proper tax filings.

There is no "one size fits all"
cross-border financial planning strategy. Therefore, it is important to partner
with a qualified team of tax, legal and investment professionals who specialize
in Canadian and United States cross-border transitioning. Please contact
Cardinal Point Wealth Management at http://www.cardinalpointwealth.com/US/contactus.html to review your unique situation.